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It’s been an enormous month and a half for climate-change news in the United States.
First, and most obvious, Joe Biden won the presidential election on a vow to put climate policy at the center of his domestic and foreign policy. That was a big deal.
Then he actually started to do it. He’s named climate experts to senior White House positions and laid the foundation for an ambitious and diverse so-called climate Cabinet. Just last week, Biden said he would nominate Representative Deb Haaland to lead the Department of the Interior, which oversees federal lands. If confirmed, she would be the first Indigenous American in that role.
Then, yesterday, Congress passed a bipartisan superbill (note: this is not a technical term) combining economic stimulus, federal spending, and several years of industrial policy. Glooped onto the text were several energy and environment bills that will steer the federal ship of state toward decarbonization. The bill extends tax credits for renewable energy and carbon capture, it funds energy-efficiency projects, and it recommends—in a legally nonbinding way—that the Department of Energy prioritize projects that will help generate 100 percent of U.S. electricity through “clean, renewable, or zero emissions energy sources.”
But. These were not the only climate stories of 2020. This year has been so jammed with news—much of it with urgent, imminent, and life-altering implications—that I think many people might have missed the most important climate developments.
2020 was a monumental year for climate news—and it would have been even if Biden had lost. Many of the world’s most powerful institutions changed how they thought about climate change this year. Climatic upheaval and the energy transition, both of which had long figured distantly in leaders’ planning, became a near-term economic issue.
So 2020, I’d wager, is the year that the climate became the economy. If Biden’s policy reflects that change—for instance, he named Brian Deese, a financier and one of President Barack Obama’s top climate advisers, to lead the National Economic Council—then it’s because he’s aligning with that new consensus as much as setting it.
So, with that in mind, here are the top five climate stories of 2020:
1. The most important story of 2020 was President Xi Jinping’s announcement that China would aim to start reducing its carbon pollution by 2030—and achieve net-zero by 2060. His promise, which came in two sentences in his speech at the United Nations General Assembly meeting in September, was a total surprise. But it was crucial.
China is the world’s largest emitter of greenhouse gases. It is responsible for 30 percent of global carbon pollution, and—unlike the rich countries of North America and Europe—its emissions are still growing. China’s model of economic growth is also dependent on creating mind-bending amounts of carbon-intensive steel and concrete. (As a certain type of global thinker will never tire of repeating, China poured more concrete from 2011 to 2013 than the U.S. did in the entire 20th century.)
So China’s vow is significant in its own right: It signifies the future elimination of a colossal amount of CO₂. It shows, too, that China’s ruling party is worried about climatic turbulence. As the historian Adam Tooze has written: “It is precisely because the Communist Party regime is bent on shaping the next century that its leader takes climate change seriously.” It also reveals—as a December speech by Xi did, too—that China is willing to compete with the West over who can cut carbon the fastest.
But it points to a more important development than even that, I’d argue. China set the pattern for rapid 21st-century development through its coal and construction-heavy economy. (A pattern modeled, of course, on the United States and Europe.) If Xi can figure out how to peak China’s carbon pollution while the country still grows economically, then China could fashion a new kind of development model for other countries to follow. Such a model wouldn’t just reduce existing emissions from China, but prevent future emissions from other countries—because they would be able to follow China’s lower-carbon path.
As for specifics, we don’t have many. We’ll get a better sense of how China plans to meet its goal early next year, when it unveils the climate aspects of its next five-year plan.
2. Earlier this month, European Union leaders agreed to strengthen the Continent’s climate goals and pledged a new target of 55 percent greenhouse-gas reduction by 2030. The old goal was a 40 percent cut by that year.
What’s more important than the cuts themselves is their political context. They emerged out of deadlocked talks over a 1.8-trillion-euro package meant to fight the coronavirus recession. The stimulus aimed to spark a climate-friendly recovery, part of what the EU calls the “European Green Deal.” But crucially, the package also pushed the 27 member countries into a closer financial union, allowing the EU to issue joint debt for the first time.
The stimulus was first proposed in the spring. It immediately encountered resistance: Hungary and Poland, both led by far-right prime ministers, argued that the EU stimulus should not be dependent on upholding anti-corruption rules. They threatened to join forces with the Netherlands, Sweden, and other rich countries that wanted a veto over issuing joint EU debt. Thankfully, that didn’t happen. On December 10, the member nations held marathon talks and finally agreed on a compromise. Then, having reached that deal, German President Angela Merkel immediately held more talks through the night—which produced, on December 11, the new climate goal.
The goal is big enough to matter: The EU is the world’s third-biggest carbon polluter, responsible for about 8 percent of emissions. The deal, in my view, shows how political stability drives climate diplomacy: The Continent will be able to do far more on climate change working together, and issuing debt together, than separately. And maybe most important, it shows how China’s pledge is driving other countries to make even bigger cuts. The EU must now cut more carbon in the next decade than it has since 1990.
3. The pandemic—and its lessons. The pandemic has had a direct influence on climate change: Greenhouse-gas pollution is projected to drop this year by about 7 percent, a record decline from 2019. This is the kind of emissions reduction that no one wants to see, because it flows not from reducing fossil-fuel use in the economy, but from a breakdown in the economy itself.
Yet it’s a decline nevertheless. We may soon be able to discern a faint COVID-19 signal in the Keeling curve, the chart of atmospheric CO₂ concentration over time.
Of course, the economy will soon come roaring back—and emissions with it. What’s likely to endure are the lessons of the pandemic. The virus revealed that the global economy remains vulnerable to physical shocks, even ecological shocks: The global recession of 2020, unlike the global financial crisis or the dot-com bust, was caused not by turbulence in the financial system but by damage to the network of flesh, steel, and wire that physically constitutes the global economy.
At the same time, we learned that focused government funding and attention can accelerate the deployment of life-changing technology. Operation Warp Speed, the federal program to develop COVID-19 vaccines, has produced two safe and effective vaccines within a year of the virus’s discovery. A similar approach could work if applied to clean energy and other climate tech, too.
Another lesson: A society-wide shift in behavior can’t solve climate change. Consider how differently Americans lived this year versus last year. Tens of millions of people stopped regularly commuting. We stayed at home more and took fewer flights. Enormous office towers went essentially uninhabited. Yet America’s carbon pollution is projected to decline by only about 12 percent from 2019. Even in April, at the peak of global shutdowns, when cars, trains, and planes sat idle across much of the world, American emissions declined by only about a third, and global emissions declined by 17 percent.
4. The markets began to consider the cost of climate change—and the benefits of the energy transition.
For years, we climate reporters have said that solar and wind energy are becoming price-competitive with fossil fuels. This was the year that global markets really seemed to notice. Across the world, but especially in the United States, we saw a concerted move toward recognizing the potential of zero-carbon energy.
In October, the International Energy Agency pronounced solar “the cheapest electricity in history.” NextEra Energy, a Florida firm that sells wind and solar electricity to utilities, became one of the country’s most valuable energy companies, its value rivaling that of Exxon and Chevron. More and more venture capital is going to climate-tech start-ups, according to the accounting giant PwC. And funds tracking the solar and wind industry consistently outperformed the S&P 500.
This year, too, asset managers woke up to the risks of climate impacts, especially sea-level rise and wildfires. The home-insurance market in California started to strain, and coastal homes in Florida lost value.
Financiers seemed to decide en masse, too, that oil and gas stocks posed too much risk to the rest of their portfolio. The oil-and-gas sector became one of the smallest sectors, if not the smallest, of the S&P 500 by market value. (It doesn’t help that oil stocks have underperformed for a decade.) Every major American bank promised to stop funding Arctic drilling. Lloyd’s of London, the world’s largest insurance market, said it would stop covering coal, oil sands, and Arctic drilling projects by 2030. Exxon laid off 14,000 workers and cut more than $17 billion from the book value of its business.
And American regulators woke up to these changes. The Commodity Futures Trading Commission, which oversees financial derivatives, warned in a bipartisan report that climate change could damage the U.S. economy. The Federal Reserve became the last major central bank worldwide to join the Network for Greening the Financial System, a coalition that looks at systemic financial risk from climate change.
There were fluky moments in this transition. Tesla’s stock price rose 700 percent this year, part of a surge in demand for electric-car stocks that is, if not bubbly, at least effervescent. A barrel of oil fetched a negative price in April—you had to pay someone to take oil off your hands—but that happened as much for market-structure reasons as for trend-driven ones.
All this market movement doesn’t supplant the need for policy. Some of these changes are happening because investors expect policy to arrive, not because it’s already here. But taken together, they show that the world’s most powerful financial institutions believe that the future is decarbonized—and that, far from hurting the economy, climate action is likely to help it.
5. Finally, let’s talk about that bill.
Yes, the bipartisan bill that Congress just passed. I haven’t mentioned its most important emissions-cutting measure: It commits the U.S. to phasing out a type of chemical called hydrofluorocarbons, or HFCs. Though normally used in refrigerators or air conditioners, HFCs can escape into the atmosphere and trap heat thousands of times more effectively than carbon dioxide.
Because HFCs are so potent, phasing them out has monumental climate benefits. So this bill will avert the equivalent of more CO₂ emissions than Germany emits in a year. It may be “the single most effective emission reduction measure taken by Congress in over a decade,” according to the Rhodium Group, an energy-analysis firm.
When joined with other action to phase out HFCs worldwide, it could avert one-fifth to half a degree Celsius of warming by 2100. Consider even that a low-ball estimate. Under the Paris Agreement, the world committed to averting 2 degrees Celsius of warming by the end of the century. A global phaseout of HFCs gets us 10 percent of the way there. That’s actual progress—and some truly good news to end an awful year.
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